Physical demand is extraoridnary and most of the buyers are Chines or Indian. Jim Sinclair has been so right in his analyses, timewise he may be a bit off but fundamentally he's been right in his predictions. Chinese are laughing all the way to the bank while western banks sell their gold. Orchestrated manipulation has never been so blatantly obvious.
By Phoebe Sedgman & Claudia Carpenter - Apr 19, 2013 1:14 PM GMT+0200
ded gains above $1,400 an ounce on signs that jewelers and other users of the metal are taking advantage of the biggest slump in prices in three decades. Silver headed for the worst week in almost 19 months.
The premium for metal on the Shanghai Gold Exchange is as much as $10 an ounce, in Turkey it’s almost $20 and in Asia it’s about $5, Bernard Sin, head of currency and metal trading at bullion refiner MKS (Switzerland) SA in Geneva, said by e-mail. Last week, it was about $1 in Asia and Dubai, he said.
“Physical demand is extraordinary,” Sin said today.
Gold for immediate delivery rose as much as 2.6 percent to $1,426.05 an ounce and was up 1.6 percent by 11:53 a.m. in London. Prices are down 16 percent this year and dropped to $1,321.95 an ounce on April 16, the lowest since January 2011. Gold futures for June delivery climbed 1.4 percent to $1,412.40 an ounce on the Comex in New York.
The metal plunged 14 percent in two sessions through April 15 on growing optimism that an economic recovery in the U.S. will curb appetite for the precious metal as a haven. Prices also dropped on concern Cyprus may lead other European states in selling the metal from reserves, according to Goldman Sachs Group Inc. Retail sales and jewelry demand soared in India and China, while the U.S. Mint sold 153,000 ounces of American Eagle gold coins in April, the highest in almost three years.
“We are already seeing a strong response to the fall in prices, with a sharp pick-up in physical gold sales by investors and retail consumers in the two key consumer markets -- India and China,” Mark Pervan, global head of commodity strategy at Australia & New Zealand Banking Group Ltd. (ANZ), said in a note today.
Holdings in exchange-traded products backed by bullion decreased for a 13th day to 2,348.099 metric tons, the lowest since January 2012, according to data compiled by Bloomberg. Assets in the SPDR Gold Trust, the biggest ETP for the metal, were at the lowest in three years.
Gold will rebound from its two-year low and rally as skepticism over the recovery in the global economy increases demand, according to billionaire Indian jeweler T.S. Kalyanaraman. Bullion will gain to $1,800 an ounce, Kalyanaraman, chairman of Kalyan Jewellers, said in an e-mail.
A rush in India to buy gold jewelry and coins will boost imports this quarter as traders and banks run out of stockpiles, Mohit Kamboj, president of the Bombay Bullion Association Ltd., said yesterday. Daily customer traffic in Hong Kong and Macau rose as much as 25 percent April 13-16, said Chow Tai Fook Jewellery Group Ltd. (1929), the world’s largest jewelry chain.
“We’ve seen enormous numbers of people and they’re all buying,” said Nigel Moffatt, treasurer of Australia’s Perth Mint, which refines nearly all of the nation’s bullion. “There’s been continued buying interest, particularly into China,” he said on Bloomberg Television today.
Silver for immediate delivery climbed 1.9 percent to $23.7088 an ounce, heading for a weekly slump of 8.8 percent, the biggest such drop since September 2011. Prices fell to $22.07 on April 16, the cheapest since October 2010.
Palladium rose 1.5 percent to $678.70 an ounce, trimming a third weekly decline. Platinum advanced 0.6 percent to $1,442.06, poised for a sixth weekly drop.
To contact the reporters on this story: Claudia Carpenter in London at [email protected]; Phoebe Sedgman in Melbourne at [email protected]